Financial statements are essential for every company. They provide insight into the health of a company, as well as information on assets, liability, income and cash flow.
Related: 8 Factors That Determine the Financial Health of a Business
And the more transparent you can be with your finances, the better off you’ll be in the long run. Financial statements can help you get funding and loans, as well as prepare for the future. It may sound like a daunting task, so to get started, break down the process into stages.
First, create a balance sheet. A balance sheet will show you where your business stands financially, and the different forms of assets and liabilities you currently have. After you’ve sorted that out, move on to your income statement and cash flow. Break down cash flow into operating, investing and financing activities to see where your money’s coming from.
Related: What Exactly Is Your Income Statement Telling You?
Still having trouble? No need to worry. Check out Business Backer’s infographic for a step-by-step guide to creating a financial statement for your business.